Prepare For More Downside In The Dow, Nasdaq, and S&P 500 ETFs (DIA, QQQQ, SPY)

The market continues upward in either a C wave or Wave 2 corrective upside re-tracement if I’m correct. In reviewing the pattern since the April top this year, we have had clear Fibonacci retracement levels of the 13 month rally. These occurred at 1040 and 1011 areas so far, 31% and 38% fibonaci re-tracement levels of the Fibonacci 13 month rally.

Some are saying the market just bottomed at 1011 at the 38% re-tracement area, but the Elliott wave patterns that I rely on do not appear to me to be complete. I could still be wrong and we keep on climbing here and I get egg on my face, certainly possible. However, you don’t normally get a straight 8 of 9 days down pattern to 1011 like we just saw and then end a correction there as a C wave in an A B C pattern. C waves are made up of either 3 or 5 waves within, and that was one clear wave down. These happen in fast moving markets and lead to a rare correction pattern called a “running” correction.

In the video which is free to view off my website below, I educate and illustrate on how these look and apply it to the current state of the Market. I’m looking for the following MAX topping areas for all three indices. Dow 10450, Nasdaq 2295, and SP 500 1104-1115. We are within 1-2 % here of a nice reversal to the downside that can be played via shorting. The ultimate target remains 942 on the SP 500 index, and of course those are the 50% fibonacci downside levels of the 13 month rally, and would fit neatly into the first 180 point SP 500 drop from 1220-1040. This means 1130 is the recent major B wave top, and 180 points from there is about 950 to complete the correction pattern in this bull market. I am looking for sentiment to turn pretty negative again shortly.

Please review to get updated. This current rally has hit 1099 on the S&P 500, past the 1092 area I saw the sliver gap on, but below the 78% re-tracement area as well, this 7 day rally is getting long in the tooth. Options expiry week makes it even harder, reminds me of my Mid April top call in fact here on Kitco.Com, it wasn’t long before the market rolled over hard.  I am looking for the same here as well.

(The Best way to play the Dow, Nasdaq and the S&P 500 is through ETFs and we have included some information on the DIAMONDS Trust Series 1 ETF (NYSE:DIA), PowerShares QQQ ETF (NYSE:QQQQ), and the SPDR S&P 500 ETF (NYSE:SPY) below the video.)

Written By David Banister From Active Trading Partners

About Active Trading Partners: We combine a thorough understanding of fundamentals with a wealth of technical analysis experience to take advantage of the crowd behavior in the markets.  Entering into trades after others have sold and often taken a loss, allows ATP to provide low risk entry points and high upside shortly after our recommendations.  Our founder has been quoted on CBS Marketwatch.com, 321gold.com, Stockhouse.com, Theaureport.com, and has been a guest on the national radio show “Money Matter$” in the past.  Chris Vermeulen of Thegoldandoilguy.com met the founder in 2008 as the financial crisis was unfolding.  After numerous months of following the trading profits of ATP, Chris suggested that a joint venture be formed and we offer this service to a select group of partners (subscribers). The demand for more active trading advisory services has exploded in the past few years, but we believe very few deliver low risk trades that are consistently profitable.  Our track record is in the vicinity of 90% success rates on every trade recommended.  If you can be 60% successful in the markets, you can make a lot of money.  ATP feels it has room to spare on that bar.

DIAMONDS Trust Series 1 ETF (NYSE:DIA)  Visit Our (DIA) Category: HERE

 The investment seeks to provide investment results that, before expenses, generally correspond to the price and yield performance of the Dow Jones Industrial Average (DJIA). The fund holds the Portfolio and cash, and is not actively “managed” by traditional methods. To maintain the correspondence between the composition and weightings of stocks held by the Trust and component stocks of the DJIA, the Trustee adjusts the portfolio from time to time to conform to periodic changes in the identity and/or relative weightings of index securities, typically within three business days before or after the day on which such changes are scheduled to take effect.

TOP 10 HOLDINGS (52.75% OF TOTAL ASSETS)  
Company Symbol % Assets
3M Company Common Stock (MMM) 5.98
Caterpillar, Inc. Common Stock (CAT) 4.12
Chevron Corporation Common Stoc (CVX) 5.57
Coca-Cola Company (The) Common (KO) 4.12
Exxon Mobil Corporation Common (XOM) 4.93
International Business Machines (IBM) 9.46
Johnson & Johnson Common Stock (JNJ) 4.66
McDonald’s Corporation Common S (MCD) 4.51
Procter & Gamble Company (The) (PG) 4.38
United Technologies Corporation (UTX) 5.02

Chart forDIAMONDS Trust Series 1 (DIA)

PowerShares QQQ ETF (NYSE:QQQQ)  Visit Our (QQQQ) Category: HERE

The investment is a unit investment trust designed to correspond generally to the performance, before fees and expenses, of the Nasdaq-100 index. The fund holds all the stocks in the Nasdaq-100 index, which consists of the largest non-financial securities listed on the Nasdaq Stock Market. The fund issues and redeems shares of Nasdaq-100 Index Tracking Stock in multiples of 50,000 in exchange for the stocks in the Nasdaq-100 and cash.

TOP 10 HOLDINGS (46.89% OF TOTAL ASSETS)  
Company Symbol % Assets
Amazon.com, Inc. (AMZN) 2.26
Apple Inc. (AAPL) 15.50
Cisco Systems, Inc. (CSCO) 2.88
Google Inc. (GOOG) 5.36
Intel Corporation (INTC) 2.31
Microsoft Corporation (MSFT) 5.45
Oracle Corporation (ORCL) 3.00
QUALCOMM Incorporated (QCOM) 5.45
Research In Motion Limited (RIMM) 2.25
Teva Pharmaceutical Industries (TEVA) 2.43

Chart forPowerShares QQQ (QQQQ)

SPDR S&P 500 ETF (NYSE:SPY) Visit Our (SPY) Category: HERE

The investment seeks to correspond generally to the price and yield performance, before fees and expenses, of the S&P 500 Index. SPDR Trust is an exchange-traded fund that holds all of the S&P 500 Index stocks. It is comprised of undivided ownership interests called SPDRs. The fund issues and redeems SPDRs only in multiples of 50,000 SPDRs in exchange for S&P 500 Index stocks and cash.

TOP 10 HOLDINGS (19.26% OF TOTAL ASSETS)  
Company Symbol % Assets
Apple Inc. (AAPL) 1.90
AT&T Inc. (T) 1.66
Chevron Corporation Common Stoc (CVX) 1.55
Exxon Mobil Corporation Common (XOM) 3.25
General Electric Company Common (GE) 1.61
International Business Machines (IBM) 1.72
JP Morgan Chase & Co. Common St (JPM) 1.65
Johnson & Johnson Common Stock (JNJ) 1.78
Microsoft Corporation (MSFT) 2.36
Procter & Gamble Company (The) (PG) 1.78

 

 Chart forSPDRs (SPY)

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